5 Tips for Optimizing a Wellness Business During Covid
I like to look at business in general as a container through which we offer our life enhancing wellness services through. Is it the right container? Maybe. Yet, it’s the main container we’ve got these days. As we approach another year with a pandemic, with limits on capacity and consumer demand, I ponder the financial difficulties we face. How do we continue to keep our heads up operating a wellness business during this pandemic and how we can make the most of it and gear up for the next cycle? Here are some thoughts.
Let us not forget that we all bought into the challenging job being a wellpreneur! You probably wanted work you could feel good about and love serving your community, among other reasons. Yet, the reality is that owning and operating wellness businesses can often have tight margins. What does that really mean? That means you don’t have a lot of wiggle room when it comes to your finances. I’ve seen margins on average of about 10% which means you’ve got to pull in at least $500,000 in revenue to see $50,000 in profitability. Some businesses see more like those in bigger urban demographics with a newer concept. Some see less like those in more competitive, smaller markets. If you’re really financially responsible, maybe you have taken some profitability each year and saved it for your emergency fund. We are told as individuals to have 6-12 months of living expenses accessible for emergencies, yet I rarely talk to a wellpreneur who has this lined up for their business. For my studio, this would have meant $150K - $300K in the bank for a rainy day. And guess what, NOW IS THE RAINY COVID DAY. This is a financial reality a lot of us don’t want to talk about.
I know so many are so covid-exhausted-traumatized. A huge part of this stress is due to the fact that we are not meeting our basic needs as individuals and businesses, our foundation, our roots. If I apply Maslow’s Hierarchy of Needs to a business, perhaps we don’t have enough basic care happening. We are being asked to give more than we have. We don’t have as much financial resources because we can’t operate the way we did before* and who knows if or when we will get back to that.
On one end of the business profitability spectrum we have large scale companies that go big, get investors, focus on growth as long as they can. Even these businesses have downsized right now. If your margins feel too tight, things won’t work, you might need to cut back, yet again, I know.
Ok, so the reality is we don’t know when demand will be back for in person, group experiences. Maybe we are all in an overspend situation with finances, energy, and time. What can you do in the meantime?
5 Tips for Optimizing Your Wellness Business During Covid
Decreased expenses is critical. The two biggest expenses are usually rent and payroll. Get them both down. Don’t play ostrich with this. Talk to a lawyer if your landlord isn’t receptive. A little investment of time and money now might save you long term. How long can you last with current reality and what are you going to do if it goes longer?
Meet the basic needs of yourself and your business. To me this means keep your brand alive and connected in whatever ways you can pull off and don’t get into the guilt trap about perfection or what it used to be. For yourself, draw boundaries surrounding work and fill your cup so you can come to work on your business with a smile. It’s really hard to do, I know.
Focus on marketing. There are plenty of clients who are hungry for in person right now after a year and a half of covid. Update your website and social channels with info on how you are taking care of them with clear options. I’m surprised by how many businesses don’t have this basic information anywhere! Find ways to invest in your marketing to bring in more clients. This might be the perfect time to double down on marketing and or pick up a new marketing skill to help your business be ready when demand is back.
Focus on growing revenue. This means being honest about marketing and retention efforts. Evaluate pricing and sales processes and ensure they are rewarding commitment. Evaluate your schedule and offerings and modify and adjust where needed.
Think about your exit strategy. This is not a failure! The best leaders I know are the ones that make hard choices with grace. Set some parameters surrounding what it might look like one day if you moved on from your current role and business. Lets not be frogs in boiling pots of water. You could take some time off to invest in doubling down on your business plan and brand! Time well spent if you ask me.
I’d love to hear what has worked for you so far surviving covid and/or what else you are doing to make the most of our current reality. Cheers to a new year, new chapter, next phase!